Indices trim morning losses; metal stocks shine

Key equity indices hit the day`s high in early afternoon trade. The Nifty traded near the 16,700 mark. Metal shares were in demand while auto and banks shares declined. The continued escalation of the Russia Ukraine conflict and its consequent global economic fallout weighed on investor sentiment.

At 12:32 IST, the barometer index, the S&P BSE Sensex, was up 117.82 points or 0.21% to 55,976.19. The Nifty 50 index gained 52 points or 0.31% to 16,710.30.

In the broader market, the S&P BSE Mid-Cap index was up 0.06% while the S&P BSE Small-Cap index rose 0.31%.

The market breadth was positive. On the BSE, 1848 shares rose and 1436 shares fell. A total of 176 shares were unchanged.

Economy:

The Government has permitted up to 20% Foreign Direct Investment (FDI) under automatic route in Life Insurance Corporation of India (LIC) with an aim to facilitate disinvestment of the country`s largest insurer.

The Department for Promotion of Industry and Internal Trade (DPIIT) had mooted the proposal to allow FDI in LIC, after taking views from the Ministry of Finance. The much-awaited initial public offering, IPO of LIC is expected to hit the market in March and LIC`s employees and policyholders would get a discount over the floor price.

Derivatives:

The NSE`s India VIX, a gauge of market`s expectation of volatility over the near term, surged 7.4% to 28.72. The Nifty 31 March 2022 futures were trading at 16,642.30, at a discount of 16.1 points as compared with the spot at 16,658.40.

The Nifty option chain for 31 March 2022 expiry showed maximum Call OI of 20.5 lakh contracts at the 18,000 strike price. Maximum Put OI of 50.7 lakh contracts was seen at 16,500 strike price.

Buzzing Index:

The Nifty Metal index added 3.59% to 5,820.40, extending its winning run to second consecutive trading session. The metal index rallied 9.5% in two days.

Jindal Steel & Power (up 5.66%), Hindalco Industries (up 5.45%), Tata Steel (up 4.7%), JSW Steel (up 4.35%) and Steel Authority of India (up 3.55%) were the top gainers. Among the other gainers were Vedanta (up 2.86%), Coal India (up 2.17%), NMDC (up 1.17%) and APL Apollo Tubes (up 0.74%).

Stocks in Spotlight:

Vipul Organics rose 4.45% to Rs 204.15 after the company`s board recommended bonus issue of shares in the ratio of 1:4. The company proposes to issue 1 new fully paid-up equity share for every 4 fully paid-up equity shares held. The record date for the bonus issue is set on 9 April 2022.

Unichem Laboratories fell 3%. The drug company said that it has received ANDA approval for its Divalproex Sodium extended-release tablets from the United States Food and Drug Administration (US FDA). The tablets are a generic version of Depakote ER (Divalproex Sodium) extended-release tablets. Divalproex Sodium Extended-Release Tablets are indicated for treatment of acute manic or mixed episodes associated with bipolar disorder, as monotherapy and adjunctive therapy and prophylaxis of migraine headaches.

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